Week in Review (March 15 – March 21)
Equities – We have begun to see the beginning of the death spiral in my opinion (nothing works and VIX over 60+).
In this week, we saw $2Trillion of liquidity is provided, with $8B in COVID relief, Repo’s are increased to $500B twice a day with the market still selling off. Making things worse, corporate debt defaults have already begun and facilities are asking companies to request maximum credit lines (which was provided and quickly used by all companies). This shows there is zero liquidity. Shares are overpriced yet the company has no money (needs to borrow).
Crypto – Gold and other risk assets like Bitcoin sold off to meet margin calls or protect against further downside risk by going to cash. This type of mass selling indiscriminately shows that general panic is gripping the market. I have exited positions and waiting in cash to see if we have further downside risk after another equity selloff. Last selloff, crypto and equities were correlated leading to this possibly occurring again if we see COVID cases increase in USA with market selloff. We will watch for market panic to spill into crypto possibly. If this acts as a catalyst bullish, we are ready to deploy.
Looking Forward to (March 22 – March 28)
Equities – We are about to make a Death Cross on DIA, meaning we should see longer period of
During the periods of high volatility, I find the best tool to verify entry or exit is still the EMA Cross indicator. However, using this on a Daily view with high volatility isn’t much use. Using the EMA cross on 1hr and 4hr view, with the Daily, can give you an idea of how the trend is playing out intraday.
I am watching DOW 18K as first target with 13K more likely as COVID cases in United States reach peak.
Crypto – We are also looking at incoming Death Cross on BTCUSD. Keep an eye on this with 4MA Indicator (from coia.aidan). Easy to use.
At minimum, GBTC has a gap around $6.19. I have found gaps down to $0.54 on GBTC 1HR view. This has lower chance of filling but is possible.
GBTC gaps in series $6.19, $4.85, $3.92, $2.44, $1.52, $0.90, and $0.54